The partially convertible rupee was trading at 65.87/88 per dollar.
The rupee bounced back by 10 paise to end at 68.62 on Friday.
The domestic currency has tumbled by 104 paise, or 1.63 per cent, in last six trading days.
The rupee on Monday continued its upward march against the US dollar for the third day, firming up by another 10 paise to 66.00 on fag-end selling of the American currency by banks and exporters.
The rupee had firmed up by 28 paise to close at 3-week high of 66.97 in Monday's trade.
Frantic dollar demand from corporates along with an aggressive hedging strategy adopted by importers in the wake of the currency volatility predominately took a toll on the domestic unit despite moves by the central bank to stabilise the currency.
A weak dollar overseas also aided the rupee rise while fresh sell-off by foreign funds in domestic stocks capped the currency's gains, forex dealers said.
The rupee had depreciated by 13 paise to end at 67.20.
At the Interbank Foreign Exchange market, the domestic unit commenced higher at 61.80 a dollar from previous close of 61.92.
Rupee rises against the dollar for 4th straight session.
The dollar index was trading marginally higher by 0.06 per cent.
The rupee resumed higher at 64.40 a dollar from Friday's close of 65.24 and touched a low of 64.54 at the interbank foreign exchange market.
The 30-share Sensex ended down 66 points at 28,438 and the Nifty ended down 15 points at 8,633.
The Fed's decision on tapering its monthly $85 billion bond-buying programme is expected later on Wednesday.
A strengthening dollar overseas also kept the rupee under pressure amid demand from importers. Goldman Sachs followed JP Morgan, HSBC and Nomura in cutting India's economic growth forecast and also said it expects the rupee to touch 72 against the dollar in the next six months.
The rupee hovered in a narrow range of 62.20 and 62.28
Sustained inflows of foreign funds supported the rupee
The rupee had gained 28 paise against the American currency to settle at nearly two-month high at 66.74 in Monday's trade.
At the Interbank Foreign Exchange Market, the rupee resumed lower at 59.72 a dollar from the previous close of 59.67 and declined to a low of 59.88. It bounced back on dollar selling by exporters and some banks, touching a high of 59.30 before settling at 59.35, a rise of 0.54 per cent.
A lower opening of the domestic equity market put pressure on the rupee.
Banks and importers preferred to increase their dollar position at the current level, a forex dealer said.
On Monday, the rupee gained 16 paise.
Those who consider the rupee as a proxy for virility have started thumping their chests and dreaming of dethroning the dollar from its coveted position, observes Tamal Bandyopadhyay.
The dollar index was up by a whopping 0.45 per cent against basket of six major global rivals, which also pushed the rupee to log its biggest daily loss since September 15.
Foreign institutional investors pulled out Rs 86.66 crore (Rs 866.6 million) from local stocks on Monday, as per provisional BSE data.
However, foreign capital inflows into equity market restricted the rupee's fall to some extent.
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In the global market, the US dollar rose against the basket currencies in early trade as US President Barack Obama called for diplomacy in dealing with alleged chemical weapons attack in Syria but kept open the possibility of military action against the Assad regime.
The dollar index was up by 0.43 per cent against a basket of six major currencies as euro dropped against the dollar, after quarterly economic reports from France and Germany missed expectations, said analysts.
The domestic currency had lost 10 paise to close at 59.03 against the dollar in Thursday's trade amid capital outflows linked to fall in equities.
SBI managing director PK Gupta told reporters that the rupee has been faring better than many of its peers, including the Turkish, Argentinean, and Indonesian currencies.
The rupee had hit a record low of 68.85 in August 2013.
The rupee added another 8 paise to end at 61.23 against the dollar, the highest level in more than two weeks, as the US currency traded stable ahead of the outcome of Federal Reserve's meeting today and as domestic shares surged to a record.
The rupee depreciated 20 paise to close at 63.84 in Monday's trade.
Exchange-traded currency derivatives volumes are likely to drop in view of new Reserve Bank of India (RBI) rules, casting a cloud over further participation of retail investors and proprietary traders. There are concerns that existing positions without any underlying exposure will need to be liquidated. Also, weighed down by dollar demand from local oil companies and weakness in its Asian peers, the rupee on Wednesday (April 3) ended at a new closing low of 83.44 versus the US currency.
Unwinding of long dollar positions ahead of the US job data backed the rupee sentiment
On Wednesday, the rupee had dropped by 26 paise.
The rupee appreciated by 37 paise to 62.12 against the dollar in early trade on Monday.
The rupee on Thursday plummeted to an over three-month low of 63.32 by losing 50 paise against the US dollar.
The rupee is trading weak against the dollar in afternoon trade.
The rupee bounced back by four paise to close at 65.27 per dollar on fresh selling of the American currency by banks.
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